New Delhi [India]: Bharti Airtel Ltd and its subsidiary Bharti Hexacom Ltd have prepaid ₹5,985 crore to the Department of Telecom (DoT), completing the prepayment of high-cost spectrum liabilities related to the 2024 auctions, the company announced on Wednesday.
Key Highlights:
🔹 Full Prepayment of High-Cost Debt:
- Airtel has now fully cleared the 8.65% interest liabilities from the 2024 spectrum auctions, reducing its overall debt burden.
- Total prepayment for FY25: ₹25,981 crore.
- Cumulative prepayment to date: ₹66,665 crore.
🔹 Lowering Interest Burden:
- Airtel previously prepaid liabilities carrying interest rates of 10%, 9.75%, and 9.3%—all 7 years ahead of schedule.
- As a result, the company has cleared ₹1,16,405 crore in scheduled instalments that would have been due over their original tenure.
- The average interest rate on its prepaid liabilities stood at 9.74%, with residual spectrum liabilities now reduced to ₹52,000 crore.
🔹 Reduced Cost of Debt:
- The average interest rate on the remaining spectrum liabilities has now dropped to 7.22%.
- These liabilities will be repaid in annual instalments until FY 2042.
🔹 Network i2i Ltd Redeems $1 Billion Perpetual Notes:
- Airtel’s subsidiary, Network i2i Ltd., voluntarily redeemed USD 1 billion in Perpetual Notes issued in FY 2020.
- These notes carried an interest rate of 5.65% and had no fixed maturity date.
- Remaining Perpetual Notes: USD 479 million (issued in FY 2021, callable in FY 2026).
Strategic Significance:
Airtel’s aggressive debt reduction strategy underscores:
✔ Financial prudence and strong capital position
✔ Lower cost of debt, improving profitability
✔ Operational efficiency through proactive liability management
Airtel continues to strengthen its financial health, ensuring long-term sustainability and competitiveness in India’s telecom sector.